NJ HomeKeeper hits its stride

Once criticized as ineffective, the state’s main foreclosure-prevention effort has improved its performance and is now helping 250 troubled homeowners each month, Lt. Gov. Kim Guadagno announced Tuesday.

The program, called N.J. HomeKeeper, drew sharp criticism last year from lawmakers and housing advocates, who said that it was failing to serve enough homeowners. From its inception in May 2011 to June 2012, it had spent less than 10 percent of its $300-million, federally funded budget, and had helped only about 500 homeowners.

Even the department that ran the program, the state Department of Community Affairs, acknowledged its shortcomings, and took steps to make HomeKeeper more effective. Since last fall, the department has increased staffing, expanded eligibility for homeowners, and done more to publicize the program.

As a result, Guadagno said Tuesday, the HomeKeeper program has now committed nearly $96 million in assistance to more than 2,300 homeowners since May 2011.

“While it is gratifying to see our hard work result in more families staying in their homes, we recognize there are still more people in need of assistance,” Guadagno said in a statement.
…
Assemblyman Gary Schaer, D-Passaic, who had criticized HomeKeeper’s failings, praised Constable Tuesday for “putting the program on the right track.” But Schaer also said more needs to be done, especially in light of economic stresses such as superstorm Sandy and continued high unemployment in the state.

“The question we need to ask ourselves, given the thousands of people in foreclosure, is whether 250 people a month is enough?” Schaer said. “That 250 figure should be 500.”
…
Under HomeKeeper, homeowners at risk of foreclosure because of under- or unemployment can get a zero-interest loan of up to $48,000. The loan can be forgiven if the homeowner stays in the house for 10 years.

Suppose you could have started with the first time homebuyer credit, $7,500. Added another $2,000 in tax credits for energy efficiency upgrades. Got a HomeKeeper “loan” for $48k, and then refinanced it all at 3.5% through HARP. Total savings, $57,500.

Maybe a little principal forgiveness under HAMP for good measure?

Or, you could have lived payment free for around 2.5 years, assuming an estimated rental equivalent of $2,800, that would have saved you a whopping $84,000.

President Obama on Tuesday cited legislation crafted by a Senate Democrat embroiled in an ethics controversy during his State of the Union address.

In the speech, Obama pressed Congress to let responsible homeowners refinance their loans into lower interest rates to provide a boost to the housing market’s recovery and push along the broader economic recovery.

Sens. Robert Menendez (D-N.J.) and Barbara Boxer (D-Calif.) reintroduced legislation last week that would help millions of responsible homeowners refinance at lower rates and save thousands of dollars each year.

The Menendez-Boxer bill, which would streamline refinancing for Fannie Mae and Freddie Mac borrowers, had been expected to come up in November. But the Senate never picked up the measure as negotiations over amendments in the Senate Banking Committee broke down amid other pressing lame-duck issues.

The Obama administration added it to the congressional to-do list last fall.
“It’s time that Congress finally put families first and give homeowners who have played by the rules a fair chance to refinance at today’s low rates,” said Menendez, who is facing a Senate Ethics Committee investigation into allegations of misconduct.

The Menendez-Boxer bill is “HARP 3.0″, and would extend HARP to homeowners whose loans are held by entities other than Fannie or Freddie. This is entirely different from a risk perspective, as under HARP 2, the loans are already backed by Freddie and Fannie, so reducing the rate directly reduces the GSE’s exposure to default. HARP 3 would be a net increase in dollars at risk at the GSE’s, as that risk is transferred from the current holders and guarantors.

Homeownership is a pretty shitty option if your time horizon is so short that 10 years sounds like prison to you. The transaction costs (and moving expenses) will eat you alive and you’ll barely make a dent in the principal. Buy fees, sell fees, loan fees, moving, minor improvements, paint, etc, I bet you can easily hit 10% of purchase price or more.

I’m not a big fan of the “property ladder” concept. If you are lucky enough to chain smoke houses in an upmarket, you’ll make out, but in a declining or sideways market, you’ll always be chained to a huge mortgage.

NJ is the stupidest state in the US, so you nuts that you are starting a program to pay people to stay in home at same time you are starting a program to buy people off to get them out of their homes.
I bet homes in flood zones will qualify and they will get the $48k plus the FEMA pay out when home washes away

The cash to fund the program is part of the Hardest Hit program, funded by Uncle Sam. If you don’t use it, you lose it, and all the other states that are part of the program have been dispensing funds in a similar manner. It would be “stupider” for NJ to not do this, since this is one of the few times that NJ has seen some kind of payback for the tax dollars we send to Washington.

19 – Municipalities would get their tax dollars regardless. If the owner doesn’t pay, the lender probably will (if they don’t, they’ll eventually need to deal with a tax lien that has priority over their first or second lien). If they’ve already taken it back as REO, the lender absolutely will. In the very rare case that the lender waives their interest in the property and decides to forgive the loan, the outstanding tax balance will just come up at a tax sale and someone will buy it and hound the owner till they die, or they initiate foreclosure and take the property (probably a great business model for the entrepreneurs out there).

In my short sale transaction not sure what the seller owes on the 205k purchase price paid in 2006. HUD form states I pay about 81k, out of that bank nets about 70k, almost 7k goes to the brokers and 3.5k to taxes. Initial purchase price was 71k in 1991.

I look at it like the Federal Free Crack Distribution Program — the Feds are giving us money to buy crack and distribute it in High Schools, we lose the money if we don’t buy and give away the crack, and if we lose the money we don’t get any benefit for the taxes we send to Washington. There are some things that aren’t worth doing, even with OPM.

Good move. Screw the initial investors and restructure now, before they waste two years struggling against the inevitable, by which time revenues will be down because they will no longer be the “Hip New In Place”. Mirage is still a great property, but it doesn’t shine like it used to with Wynn right across the street.

All this is to say nothing of the structural shift that has AC being gored by Pa casinos and slots at Aqueduct.

Revel is a lesson in terrible management, though even with experienced managers who might have understood the AC market better, it probably still wouldn’t have a chance in hell of breaking even in the debacle that is now the AC gambling market. And what a shame as it’s really a nice place, but run worse than any casino I’ve ever visited. Sadly, I’ve visited a lot of them.

If anyone is heading to the AC beer festival on April 5th and/or 6th, let me know and I’ll buy you a drink!

what was that big bs article in WSJ about people having to raise houses in NJ by shore. Exactly who is making them and how can they make you?

That is new construction only and for existing homes the worst they can do is raise you flood insurance or you can just skip flood insurance.

FEMA told me they tried to get folks to raise their homes in NO after Katrina, lots did those that did not got flood insurance jacked to $4,800 a year.

Folks he said quickly realized that is $400 a month and they sign up every June and cancel Every November. They only pay for the six months floods can happen.

I am looking at a place by beach this weekend a condo where building covers flood. I plan on doing contents only for flood season, or at least doing a small amount of coverage in non hurricane season. So many ways to skin a cat that whole article basiclly said folks want cheap flood insurance and if homes are raised govt should pay Yet is is a WSJ cover story

During Mayor Michael R. Bloomberg’s tenure, New York City has become a cycling haven, with sprawling lanes across each borough and a bike-share program set to begin this spring.

But as Mr. Bloomberg is to leave office at year’s end, there is widespread concern among cyclists that a reckoning awaits, and that the city’s next mayor may end this period of bike-friendly programs and policies.

The Original NJ ExPat says:
September 6, 2012 at 7:10 am
[6] Surprising. I thought for sure that $100 million was going to be sucked up post-haste by the addled offspring of Trenton pols. IIRC, you have to be recently unemployed and current with your mortgage until the financial hardship and then you can collect $50K over two years for mortgage payments and if you stay current after that you don’t have to pay the money back? It took so long for NJ to even set up the parameters of the program that I was sure that NJ politically connected relatives were getting set up in cheap condos, getting unemployed, then getting delinquent on their mortgages just in time to qualify. Under the right conditions you could be living in your own condo, drawing $600/week unemployment as walking around money and have the government pay your mortgage for two years.

There isn’t that much foreclosure issues where I live here in northern NJ. I’ve seen more people have quality issues when home inspectors don’t really meet their end of the bargain and homeowners have to go after their e and o insurance money, but at least the home is getting fixed and not completely abandoned.

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